Which of the Following Describes the Attribute of a Risk

question 41

Multiple Choice

Which of the following describes the attribute of a risk averse investor?

• A) An investor that makes decisions based on the popularity of assets.
• B) An investor that makes decisions based on the expected return of assets.
• C) An investor that makes decisions based on the advice of financial planners.
• D) An investor that makes decisions based on the expected return and the degree of risk of assets.
• E) An investor that makes decisions based on the credit rating of assets.

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Definitions:

Prime Costs

The combination of direct materials and direct labor costs that are directly attributable to the production of goods.

Nonmanufacturing Cost

Expenses not directly involved in the production of goods, such as selling, administration, and other overhead costs.

Factory Overhead

All indirect costs associated with manufacturing, such as salaries of supervisors, maintenance, and utilities, not directly tied to the production of goods.

Direct Labor

The cost of wages for employees who directly manufacture products or provide services, considered a variable cost in production.